UPS Buys Out Sinotrans
UPS bought out its Chinese joint venture partner, state-owned
Sinotrans, for US$100 million. The move means that the
US company can now go ahead and build its own transportation
and logisitics facilities in China, and also get its brown
delivery vans and uniformed delivery personnel on the
ground in China.
Starting from January 2005, UPS will assume control of
operations in five locations - Shanghai, Guangzhou, Shenzhen,
Tianjin and Qingdao - with a further 18 locations transfering
to its control by December 2005. Together, the 23 operational
regions contain 200 cities and account for over 80% of
its China delivery service.
The three major international delivery services are now
DHL, FedEx and now UPS. The most aggressive and successful
player is FedEx, which has been rapidly expanding its
presence in China in the past two
years. FedEx has its own intercontinental transhipment
center in Alaska which handles the increasing volume of
packages between North America and Asia, and uses its
own airplanes and delivery service in China.
A new air
agreement between the US and China will mean that
there will be a much increased volume of flights. As China's
economy grows, there has been great demand for senior
level logistics professionals who can help companies'
inventory and delivery needs.
As the world's center for economic activity shifts to
China, the three firms are keen on locking in Chinese
accounts for both Chinese domestic and international delivery
services.
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